Coinbase says it accidentally hired a group of mercenaries, who sold cyberweapons to Saudi Arabia and Sudan, and is now firing them https://t.co/EaWbOHmWS3
— Mark Milian (@markmilian) March 6, 2019
Apparently totally free markets are not without their pitfalls! I don’t pretend to fully understand it, but here’s an update from Gizmodo:
Cryptocurrency exchange Coinbase has acknowledged it made a major mistake when it bought Italian blockchain analytics firm Neutrino, whose senior management staff included several members of infamous Italian firm Hacking Team—which has reportedly sold powerful hacking and surveillance tools to oppressive governments.
A 2015 report by Motherboard found that Hacking Team sold software to “Kazakhstan, Azerbaijan, Oman, Saudi Arabia, Uzbekistan, Bahrain, Ethiopia, Nigeria, Sudan and many others,” matching the findings of research by Citizen Lab. A cache of documents stolen from Hacking Team servers by hackers and leaked to media showed that it had faced a United Nations inquiry into whether the sale of its Remote Control System spyware to Sudan violated embargoes imposed over its government’s numerous human rights abuses, which include allegations of slavery, child soldiers, persecution of dissidents, and war crimes.
Hacking Team sold its tools stateside to the Drug Enforcement Administration and FBI—something also not likely to go down well with the cryptocurrency community, which tends to lean heavily libertarian.
Per Bloomberg, Coinbase users as well as blockchain-focused publication Breaker Mag quickly clued onto the fact that many of Neutrino’s executives were Hacking Team alumni. In a blog post on Medium, Coinbase co-founder Brian Armstrong said the onboarding of Hacking Team staff was due to a “gap in our due diligence process” and that the decision was not properly evaluated “from the perspective of our mission and values as a crypto company.” Armstrong added that those individuals will be leaving Coinbase…
According to crypto industry publication CoinDesk, Coinbase director of institutional sales Christine Sandler had previously justified the acquisition of Neutrino by stating their previous analytics provider had been “selling client data to outside sources,” spooking some customers further.
However, on Tuesday, a Coinbase spokesperson told Coindesk it had “never shared our customers’ personally identifiable information with any third-party blockchain analysis vendors.” Some users characterized the Neutrino acquisition as another privacy violation, CoinDesk wrote, with one writing, “It’s really frightening to think who has gained access to Coinbase customer data over the years.” …